Collective dismissal in Italy

The general provisions concerning collective dismissals are set forth in Law N° 223 of July 23, 1991, thereby implementing EEC Directive 75/129.

A “collective dismissal” is defined in Article 24 of Law 223/1991 as occurring when an undertaking that consistently employs more than 15 employees, dismisses at least five employees working in one or more production units within the same province, within a period of 120 days, and as a consequence of “a reduction or a transformation of activity or type of work.” Article 24 expressly states that the provisions regarding collective dismissals also apply to undertakings ceasing their activity.

The Act also provides for procedural guarantees: i.e. the employer is obliged to give prior written notice concerning the discharge/dismissals to the plant trade union representatives and the main unions in the territory, stating the motives for the said decision, the number, positions, professional profiles of the redundant employees, the timing of the implementation of such decision, and the measures adopted to remedy the social consequences of the same.

In selecting the individuals to be discharged, the employer follows objective criteria fixed by collective agreements or, in absence of the same, as stated by the Act: in combination with productive and technical needs, family conditions, and seniority.

One of the legitimate criteria that may be adopted in a collective agreement is the attainment of retirement age.

In such case, problems arise if the number of workers who have reached retirement age is greater than the number of workers that should be collectively dismissed.

With the judgement n. 25048/2015, the Court of Cassation has clearly stated that the selection of employees, who have reached retirement age and that nevertheless will remain at work, must be founded on objective criteria in accordance with Article 4 paragraph 9 of the aforesaid Act. Furthermore, the employer must provide a clear indication of the way the sole criterion of the retirement age has been applied to the community of workers who have reached retirement age.